The federal government has a bad habit of overspending on items it could get at much lower rates. The Justice Department buys $16 muffins for a breakfast meeting; the Pentagon pays contractors $1,000 for $7 control switches used on buildings in Iraq.
The latest questionable spending comes from U.S. Customs and Border Protection which has spent at least $17 million on a housing project in Ajo, Arizona—including blatantly overpaying hundreds of thousands of dollars for standard houses while dishing out millions on unused mobile homes.
A new Inspector General report found that the agency spent more than $600,000 each on houses that were priced nearly seven times higher than market value. The homes, which range in size from 1,276 to 1,570 square feet—sold for less than $100,000 last year. Meanwhile, CBP also spent around $2.4 million on 20 mobile homes –18 of which are sitting vacant.
“We identified about $4.6 million spent on the project that could have been put to better use,” the inspector general said.
CBP bought the houses and trailers so its employees could rent them out at market rates-though its unclear what they are paying. Apparently, the program was meant to address a potential housing shortage in border towns, where federal agents have flocked to address the immigration crisis.
As Doris Meissner, a senior fellow at the Migration Policy Institute told the Arizona Republic, “The private industry has filled most of those needs, making the Ajo project and the funding it received –atypical.”
In the latest IG report, auditors blamed CBP managers for not conducting studies required by law, and they said the managers were unable to provide them with cost comparisons to support their purchasing decisions.
The audit "confirms what we always suspected about serious waste and mismanagement in this project,” Sen. John McCain (R-AZ) said in a statement on Thursday. “These damning findings will help hold CBP managers accountable as they plan future projects and assist Congress in its oversight efforts."
For its part, the CBP said it has taken steps to address the IG’s recommendations –including developing a better process to evaluate how funds are spent. However, officials took issue with the IG’s cost calculations.
Top Reads From the Fiscal Times: